Court Hands BT Setback in Hyperlink Case

British Telecom (BT) suffered a setback Wednesday in a test case of its ongoing quest to claim a patent on hyperlinking

BT’s first attempt to prove its claim, which would allow it to demand that U.S. ISPs license the right to use hyperlinks, was filed
against Prodigy Communications.

According to published reports, U.S. District Judge Colleen McMahon ruled that BT’s patent claim was not necessarily valid because it assumed a central
computer connected to separate remote terminals by telephone lines. The Internet itself is much more decentralized.

The abstract about the patent said, “Information for display at a terminal apparatus of a computer is stored in blocks the first
part of which contains the information which is actually displayed at the terminal and the second part of which contains information
relating to the display and which may be used to influence the display at the time or in response to a keyboard entry signal.

“For example, the second part of the block could include information for providing the complete address of another block which would
be selected by the operation of a selected key of the keyboard. The second part of the block could alternatively influence the
format and/or color of the display at the terminal.

“When a block is read from the store of the computer the second part is retained in another store which may be located in the
terminal or in the computer itself or perhaps both. The invention is particularly useful in reducing the complexity of the operating
protocol of the computer.”

BT has retained technology development and licensing company Scipher plc — formerly the Thorn-EMI research lab — to pursue its
patent claim through QED, its Intellectual Property licensing business. Scipher has worked with BT in the past. Most recently it
worked with BT to help the company create licensing agreements for its optical fiber amplifiers.

BT said it forgot about the Hidden Page patent until it was rediscovered three years ago during a routine review of the 15,000
patents the telecomm holds. Licensing of the patent only became viable recently with the blossoming of wide-spread commercial use of
the Web.

Judge McMahon’s ruling is part of the first phase of proceedings. BT and Prodigy now have 30 days to file motions for a summary
judgment. If the case isn’t dismissed, a full trial is expected to begin in September.

In 2000, BT contacted 16 ISPs in addition to Prodigy, including AOL, and demanded they buy licenses to use the technology. If BT
wins in court against Prodigy, it is widely expected to pursue other ISPs for licensing fees.

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